ah !
I tried evaluating sub-expressions, albeit not in a compile-buffer.
When I evaluate

(compilation-buffer-internal-p (current-buffer))

I get thrown to the debugger: <quote src="*Backtrace*">

Debugger entered--Lisp error: (wrong-number-of-arguments #[nil "ŽÀŽÁ!‡" [local-variable-p compilation-locs] 2 ("/usr/share/emacs/22.1/lisp/progmodes/compile.elc" . 48467)] 1)
  compilation-buffer-internal-p(#<buffer *temp*>)
  eval((compilation-buffer-internal-p (current-buffer)))
  eval-last-sexp-1(nil)
  eval-last-sexp(nil)
  call-interactively(eval-last-sexp)

</quote> so the problem's there.  C-h f says <quote>

compilation-buffer-internal-p is a compiled Lisp function in `compile.el'.
(compilation-buffer-internal-p)

Test if inside a compilation buffer.

</quote> and /usr/share/emacs/22.1/lisp/progmodes/compile.el.gz
(helpfully uncompressed on the fly by emacs) says: <quote>

;;; test if a buffer is a compilation buffer, assuming we're in the buffer
(defsubst compilation-buffer-internal-p ()
  "Test if inside a compilation buffer."
  (local-variable-p 'compilation-locs))

;;; test if a buffer is a compilation buffer, using compilation-buffer-internal-p
(defsubst compilation-buffer-p (buffer)
  "Test if BUFFER is a compilation buffer."
  (with-current-buffer buffer
    (compilation-buffer-internal-p)))

</quote> so it looks like a typo in your patch - it should either call
compilation-buffer-p or omit the (current-buffer) parameter to
compilation-buffer-internal-p.  (I should also note that the error
message produced, claiming and got the wrong number of arguments, was
was not so helpful !)

Changing the defun to <quote>

(defun compilation-find-buffer (&optional avoid-current)
  "Return a compilation buffer.
If AVOID-CURRENT is nil, and
the current buffer is a compilation buffer, return it.
If AVOID-CURRENT is non-nil, return the current buffer
only as a last resort."
  (if (and (compilation-buffer-internal-p)
	   (not avoid-current))
      (current-buffer)
    (next-error-find-buffer avoid-current 'compilation-buffer-internal-p)))

</quote> and doing C-c C-e to that fixes the bug :-)

	Eddy.